Unexpected Financial Emergencies When a Parent Dies
Death can be expected or sudden, but the mental setback experienced by the deceased family members can be immense. To make matters worse, sometimes, most family members are left without any clue of the financial details of the parent.
To those who know the parent’s account details, the institutions have tedious protocols that must be followed by the children or the family members. Besides, there are immediate costs the family has to undergo, like burial arrangements and unmanageable hospital bills. The deceased may have left a list of due debts like mortgages and bank loans.
Immediately after a parent’s death, what follows is the funeral arrangements. Funerals cost a lot of money from the morgue, the hearse, cemetery costs, and other legal fees. If the family has no money, they might be forced to rely on donations from friends and extended family members. Some might be forced to sell some of the family’s valuables to raise money or possibly consider a bank loan.
If the deceased member has taken senior life insurance, it can be a great relief to the family because they will not strain to arrange for a funeral. Choosing the best insurance company that offers friendly burial and final expense packages can be a daunting task.
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The parent might have died due to long-term sickness or an accident that demanded expensive treatment. Even though they might have medical insurance cover, the bills can go beyond the insurance limit forcing the family to dig deeper into their pockets.
Some hospitals might demand the family to clear the pending bill before the burial and some might ask the family to submit security for the bill. Whichever the case, the family might have no or limited source of income, yet they will have to attend to the bill emergency.
Rent and mortgage
Rent and mortgage cannot wait until the family settles and gets enough monthly income. The landlord will come and demand rent by the month-end or the agreed due time. The mortgage company will demand their mortgage payments or threaten to foreclose the house.
What was once a smooth arrangement suddenly becomes a financial emergency because the family has to think of ways to get money to settle rent or mortgage demands. If the worse comes to the worst, the family will have no choice but to move to a cheaper neighborhood or sell the house to clear mortgage balances.
School or college fees
There could be children who are still in school and they will expect you to pay the fees at the beginning of the term. Some children might be forced to change schools while some drop before time. Education is important and it can help the family members settle in a better life after college.
If the deceased parent was the sole provider to the family, it means they will look for other alternatives to pay fees. Some may seek help from the government, while others might apply for scholarships or seek help from relatives. It is never guaranteed that the alternatives will provide the much-needed assistance.
The family may not be obliged to settle loans owed to the bank by the deceased member, but if the member had used the family property as security, the bank might have a right to sell the property.
In such a case, it will be upon the family to look for ways to settle the debt or sell the property. If they cannot make a fast arrangement, the bank can auction the only property the family hopes in.